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Debunking the profligacy of the poor

21 November 2014

Booze and fags are not at the top of every shopping list, Paul Vallely reports

NEWS of a dubious accolade arrived from my birthplace, Middlesbrough, this week.  hannel 4's controversial Benefits Street has been scouting the town's most depressed housing estates, and has finally lighted upon a street just across the river in Stockton to film a second series of its poverty porn.

How depressing. A public-service broadcaster ought to be challenging rather than reinforcing politicians' attempts to divide the nation into strivers and skivers. The idea that welfare benefits create dependency is on the rise. Polls suggest that three times more people than during the 1993 recession now assume that those on benefits are "fiddling".

Facts suggest otherwise. "They spend it all on booze and fags" was the title of a recent seminar at Manchester Policy Week, subtitled "Debunking misconceptions of welfare spending". Extensive research reveals that it is a myth that most poor people do not spend their money wisely. "The cliché is that people are on low pay because they haven't worked hard enough, or have taken bad decisions," Professor David Hulme, of the Brooks World Poverty Institute, said. The Institute has studied child benefit and old-age pensions in Brazil, Mexico, South Africa, India, and Bangladesh.

Money given to the poor does not go on wasteful consumption. In South Africa, old-age pensions are used by grandmothers to pay school fees and buy fertiliser. Cash transfers elsewhere reveal children get better grades at school, are physically taller, and show improved cognitive ability because they are better fed.

After initial suspicion in Brazil, Mexico, South Africa, India, and Bangladesh, the elites there now see that giving cash to poor people (and improving their access to health and education) is in the national interest, because it strengthens their ability to look after themselves, reduces social problems, and promotes economic growth.

Political reluctance from the middle classes to support such schemes led politicians in some countries to insist that poor people had to get their children inoculated or send them to school to get the cash. But such transfers work whether there are conditions or not. Indeed, conditionality can be counter-productive, as in New York, where the poor had to fulfil 28 conditions to get their cash.

"They probably got the wrong people to decide what the 28 conditions were," Sarah Whitehead riposted at the seminar.

She was billed as a citizen activist. But that did not tell the full story. Sarah is 27, a single mother, with a disability, and a child of dual heritage. She is a classic candidate for "spongers and scroungers" rhetoric. Except that Sarah transformed the rubbish-filled alley by her Salford home into a community garden, inspiring surrounding streets to do the same and come together in a local forum. This then set up a jobs centre, community gym, and café. She also works with prisoners and Age UK.

Despite all that, when the local paper printed a picture of her, it showed her relaxing with a glass of wine. They spend it all on booze and fags, you see. There is clearly someone on the local rag angling for a job with Channel 4.

Paul Vallely is a Senior Fellow at the Brooks World Poverty Institute at the University of Manchester.

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